What happens with ISAs after initial term?

jamels2

First a cash ISA, say I put 10000 in at 2% for a year fixed , I end up with 10200 after a year. What happens next? Does the rate continue or revert to a basic savings account?

Also same question for s&s isa, say I put in into index funds , will it just stay in those funds?

eskbanker

jamels2 wrote: »

First a cash ISA, say I put 10000 in at 2% for a year fixed , I end up with 10200 after a year. What happens next? Does the rate continue or revert to a basic savings account?

The norm is for it to revert to a 'standard variable rate' easy access ISA, but it'll be specified in the summary box of each product.

jamels2 wrote: »

Also same question for s&s isa, say I put in into index funds , will it just stay in those funds?

There are no equivalents to fixed-term/rate cash products in the world of S&S ISAs, which are simply wrappers within which you buy actual investments, so index funds will remain within an ISA wrapper until you make a conscious decision to sell them.

18cc

Mostly they revert to instant access (usually at a much lower rate - but still an iSA) but I have at least one they says in the T&C that when the 5 years are up I will have a month to decide what to do and if I do nothing it will re-invest for a further 5 years. You need to be organised!

Albermarle

In my limited experience with fixed term cash ISA's , a few weeks before the end of the term they write to you and give you an option to reinvest in a new fixed term product or withdraw/transfer the cash. If ( or split between the two) If you do nothing the money will go into a low interest easy access ISA.

But as mentioned above they will not all follow exactly the same pattern.

As said your S&S ISA will not change unless you specifically request a change . You can do this one day/one month/one year/twenty years . There is no time limit

Flobberchops

As above. Fixed term ISAs tend to change to instant access versions. Bank "bonds" (fixed term savings) may either automatically renew or pay out on maturity. Read the Ts and Cs of the account you're interested in!

Heedtheadvice

Firstly thd ISAs are still ISAs.
The terms and conditions of a cash isa account vary with supplier so as said above for isas with fixed term Ts&Cs you need to take action such as repeat term, allow to roll o er to easy access (Ts&Cs) determi what you can do with the current supplier but you can do an ISA Transfer to another cash ISA account/supplier or transfer into a stock and shares ISA with a multitude of providers. You can hold cash in these S&S isas with limitations.


Eskbanker probably should have added "they remain in a S&S until you sell them AND take the cash out of the ISA."


in some circumstances you can put the money back into an ISA within the tax year.


Do not confuse the ISA account with the ISA wrapper - connected but not quite the same!